Families and Household Formation

The chart below (last 20 years) shows that non-family households have generally been growing in line with the US population and although dipped in 2008, have since recovered.

Non-family households vs. the US population (thousands, source: US Census Bureau)

The real problem however is found in the familyhousehold formation. Family households have completely decoupled from the US population growth since 2008.

Family households vs. the US population (thousands, source: US Census Bureau)

This deviation is quite new. Family households have been forming at an average rate of 651,000 per year since at least 1947 (when the first annual household data became available). During that whole period the only years showing "negative formation" are 2008, 2010, and 2011 – likely the result of families moving together (parents and grandparents, etc.).

This is my interpretation as well. From causal looks at the data, as well as other anecdotal evidence, it looks as if the percentage of kids moving back in with their parents is at all time high.

I would suspect that we do have some grandparents moving in, but it looks like its mainly the kids.

Moreover, much of this looks to be driven by a decline in marriage rates. So, we are thinking of a traditionalist family model where the extended family lives together until the kids are married off. The kids are not marrying off and so the family is staying together. If we look at the data we do see a sharp drop in the marriage rates of those with a high school education or less.

The household dynamics are complex, but here is my first blush takeaway. The demand for housing is still essentially “pent up” unless the marriage rate is declining.

It’s not enough for the marriage rate to be low because that alone will not produce a higher equilibrium household size. It will simply time-shift household formation towards a new matriarch formation point.

Now, I don’t know what produces a matriarch in the absence of marriage. Probably not simply death of the old matriarch. There is likely some other dynamic that occurs when a daughter defines her own household even without marriage occurring. What that is I don’t know.

My standard thinking is that it is not really important to think about the men. Its female household formation and evolution that matters. Men will simply become attached or detached from the female stem line but the women are the core of the household and the men can be treated as white noise about that core.

My standard thinking is that it is not really important to think about the men.

I would argue that depends on where the throttle sits. If resource availability is the throttle, then yes the men are what matters. However, if human fertility is the throttle then females are what matters (and mostly you can throw childrearing into that, but no always).

Taking a bit of a wild guess, up until recently resource availability was no problem, but as a consequence we got sloppy and household efficiency is a bit poor. These days the resource throttle is tightening (just check the statistics for families depending on food stamps). If resources aren’t the bottleneck right now, then it’s heading in that direction.

[…] them by the disheartening tag of Generation Jobless. Because of unemployment, young people have been unable to start their own family households. So many are moving back in with their parents that the number of family households is shrinking. […]